A Practical Navigator for the Internet Economy

The Networked Technology Universe of Dr. Patrick Soon Shiong

Before the summer of 2011, when Dr. Patrick Soon Shiong bought National Lambda Rail or rather agreed to be responsible for up to $100 million of its expenses – I had no idea that this entrepreneur physician even existed.  Over the past 4 months my research has shown him to be a creative, brilliant, fascinating, reclusive individual who, being the 46th most wealthy person in a nation of  300 million can do essentially what he pleases. Physician, surgeon, researcher, innovator, entrepreneur, and above all businessmen he is–in our new Gilded Age–an example of the many different ways in which vast wealth can be used.

Born in South Africa to Chinese parents, Soon-Shiong,  overcame the many abuses of apartheid, left with his wife to do a residency in Vancouver British Columbia in the late 70s, and by 1983 he moved to UCLA where he became a top-notch surgeon involved in the treatment of diabetes and pancreatic problems. He dove in the 1980s into research and into entrepreneurial  activities and business by the early 90s’s.  He founded two major pharmaceutical companies; developed one of the very 1st nanotechnology treatments for breast cancer; sold the 1st company in 2008 and the 2nd in 2010 for a total of approximately $7 billion combined. Already wealthy from some of his earlier business activities, by 2008 he had begun to fund research into health care policy.  In 2009 he organized formally an organization called the National Coalition for Healthcare Information known as NCHI.  In 2009 he began a whirlwind of activity with the Obama administration’s stimulus interests in Healthcare Information Exchanges and involved himself in major funding at St. John’s Medical Center and - as with National Lambda Rail - promises to pay up to $100 million of expenses to reopen Martin Luther King Hospital in the poorest area of Los Angeles. He became the director of a Wireless Healthcare Institute at UCLA and established a Genomic Supercomputer Center in Phoenix into which data would be fed by National Lambda Rail.

As a part of my preparation for this report I have read and transcribed part or all of his more than two dozen available online speeches; received what appears to be a standard 30 minute interview with the manager of his financial affairs the Hon. Bob Pierce; exchanged some limited e-mail with staff and given the same staff a final draft copy in more than 30,000 words and almost 90 pages of this issue all without any substantive comment from said staff.

There is no question that Dr. Soon Shiong possesses enormous intellect and his intense critique of the broken American medical care system is certainly spot on. He has acquired the services of many top people including the American inventors of grid computing on which he explains that his medical information superhighway will depend. But when you talk to the folks at Globus online as I did at SC11 in mid November, you find that they are no longer working with Dr. Soon-Shiong. In the absence of any willingness to communicate on the part of Dr. Soon-Shiong it is very very difficult to understand why this lapse has occurred. It is my belief and of course since these are my opinions I could be wrong – that Mr. Peirce when I interviewed him for the allotted 30 min. on August 24, 2011 assumed that I was like one of hundreds if not thousands of journalists doing the standard thousand word article and that I would be unlikely to burrow very deeply.

But spurred on by the reticence that I encountered, I have burrowed quite deeply and have been forced to use open-source research tools along with my knowledge of research networks and computers in medicine -- having first reported on the latter 32 years ago.  The basic story here it seems to me is that a man of Soon-Shiong’s wealth does essentially what he pleases and informs whom he pleases of what he does. That is certainly a choice for which he cannot be faulted.  And yet I was positively stunned by the amount of material I was able to find by use of Google. Readers will see for themselves.   After 4 months and about 300 hours of work I believe that I have gathered a rather complete picture of what he's doing especially over the past four years or so since he broke into the ranks of billionaires.

The overall picture is extremely impressive. But from a public policy public interest point-of -view I do find it disturbing that while he appears in Google alert almost every day, you will not find comprehensive picture out there of what he is doing. I believe that this is because -- in commercial journalism for sure -- no one has the ability to pay any one person to focus on amount of time required to wade through the open literature. And in this respect of course I am rather different. Different–as readers know after 20 years -- in that I like to get to the bottom of things and have no arbitrary limits of length.

I began to really dig in to my research In the late days July and after about 10 days of reading my fragmentary notes included two conclusions. The first was that -- other than becoming known as a medical reformer and philanthropist, he had no discernible master plan. But as I looked at all the activities in which he was engaged: philanthropy to hospitals, nanotechnology and in building biotech companies; heading what he called “do tanks” rather than “think tanks” in the medical policy arena; and venturing into the basic reform of the research or knowledge and then to the patient or point of delivery of care and finally to insurers or payers for that care -- as well as trips to Washington DC during the stimulus legislation; wireless medical applications and UCLA; foundations that he began to set up with his wealth as well as finally investment funds being used to acquire new companies.  When I surveyed all this, I noted by the end of the 1st week in August that the only rational assumption -- in view of the extremely broad arena of his activity -- was that building a new healthcare system that would be based on the infrastructure that he was using his new found wealth to purchase was the only outcome that would make any sense.  And ”hello,” by the 3rd week of November we have a  rather gushing and ecstatic article in Forbes saying almost precisely that – namely he was going to reform health care by building a new healthcare system.  See “Billionaire Patrick Soon-Shiong Wants To Remake The U.S. Health Care System.  The most significant effect that I can see is that many people  - certainly the one percent with plenty of money and eager to make more will watch him via stock pick groups on the internet and Invest in the companies that he is acquiring. But the effects are not limited merely to money making.  See for example the November 27th New York Times news analysis on “policy making billionaires.”

The system he is building, starting in Los Angeles and working eastward through Nevada and into the Phoenix Scottsdale Arizona area will be undoubtedly a vertically integrated state-of-the-art structure oriented towards genomic medicine in the treatment of cancer with a stunning integration of state-of-the-art technology at all levels into the modernization of the delivery of care oriented toward wellness rather than just the treatment of illness. However the image in my mind from my experience of observing him for the past 4 months is that of observing a Lorenzo de Medici in Renaissance Florence. He does what he wishes without any discernible roadmap -- creating a situation where, if one has seen only one or two press releases, one sees only a fraction of what he's doing and, for example, is likely to miss his use of the opportunities afforded as, due to the economic crisis, the social fabric of America unravels.

A case in point of which I'm thinking is his November announcement through a letter of intent for a 12 week negotiation with the people in charge of establishing a hugely complex integrated computerized court case management system for the State of California on which well over $1 billion in public money has been spent.  And one in which, given California's desperate fiscal state, needs only a smallish amount of money to begin to put it into operation. The letter of intent mentions that he is willing to give the people involved $20 million to accomplish this end.  No one knows precisely what the outcome will be.  But its is relatively easy to understand the nature of his interest if one is fully aware of his plans for the nationwide medical supercomputer highway based on National Lambda Rail and the supercomputers that he has purchased and now installed for operation in Phoenix.

The desire here is to build a comprehensive national medical information system composed of patient electronic records that will bring to bear both advances in knowledge and the individualized appropriate research just in time to the patient bedside. Such a system will have to be on the order of the complexity of the California court case management system that has some 18,000 pages of specifications and represents a basic structure of data and data manipulation that should be extremely useful in reconfiguring for use in areas of medical complexity rather than legal. Given the extreme nature of the times, the potential to acquire rights to use the basic data structures paid for over a period of time measured in years and in excess well in excess of $1 billion by California tax payers for only 20 million would represent a very good bargain. And of course it could be argued that this is just one of the very good bargains that will be necessary to achieve fundamental reform in the nation's health care system that is now such a mess and so complex as to appear unsustainable and increasingly unavailable people unless one is one of the 1% in wealth distribution.

To summarize the systemic areas in which Soon Shiong is involved. One is basic health policy formulation. Two is gifts to help California hospitals and alliances with other networks such as the California Telehealth network. Three is a firm foothold through a UCLA  Wireless Health Research Center for patient centered delivery of care outside the hospital taking advantage of the newest technology. All of this combined with an investment business that is pushing $1 billion of acquisitions by means of various financial structures of new or emerging companies engaged in areas that fit into the overall jigsaw puzzle of the delivery of care.

Nevertheless I do find it alarming that a publication like Forbes, as far as I can tell based on fragmentary information, breathlessly reports that due to this one unusual man there appears to be light at the end of the medical tunnel. Indeed maybe its is so and we should all wish Dr. Soon Shiong success.  However there is much much more going on than Forbes reports and while we should all hope that Patrick turns out to be another Gandhi–there is enough complexity and uncertainty in what is happening.  This is especially so when his investment in acquiring new companies is not usually highlighted and especially not in view of his careful control of information regarding his investments.

Finally in the area of his acquisition of the remnants of the nation's premier research optical net work I am concerned that some of his actions will be seen by some in the academic community as arrogant–  seeming to replace the old board members with new advisory committee members; with his ruling by what looks like decree rather than collaboration and in fact by --  as far as I can tell -- not fully understanding and apparently not being interested in the history or complexity of relationships between research networks on American campuses -- he could find himself in a situation where, although he has promised to pay up to the hundred million dollars in Lambda Rail expenses, Lambda Rail suddenly becomes of declining use to him. As I was told during a few days of inquiry on the show floor at Supercomputing 11, many of the state Networks or regional optical networks (RONs) as they were known, have faced budgetary situations where they can no longer pay for a connection to Internet2 and Lambda Rail and have dropped off of Lambda Rail.

National Lambda Rail was absent from Supercomputing 11 which is the moist critical single meeting that those responsible for maintaining the technology excellence of a research optical network to attend.  I have been told by a former officer of NLR that all current researcher’s projects will be supported and maintained.  It is hard to imagine however that they will apply for new grants to run anywhere else except Internet 2.  Furthermore NLR’s IRUs to its Level 3 fiber expire in 2018.  This will make it necessary for Patrick to negotiate a renewal, the terms of which, at this point, are unknowable.

No one besides Dr. Soon Shiong’s accountants seems to know precisely what is left of NLR. While Kurt Snodgrass and Peter O'Neill work -- on the one hand with legal issues involving the acquisition and on the other hand with operational issues in Los Angeles -- I was fortunate that they did introduce me to Bob Peirce -- an introduction that did lead to the 30 minute interview.

I have seen firsthand that there is a situation into which NLR appears to be locked down.  It seems that it is a situation where even for someone like myself who has been reporting on them for many years has to be met with conversation that is either totally off record or contains no comment or no information at all. The signals given off are quite confusing and the circle of the Doctor’s inner advisors appears to be astonishingly small.  We have an extremely proprietary notion of operations being taken in an area where simultaneously -- by means of public statements --  an open-source collaborative nature of operation is praised as the desirable way to go. The outsider like myself consequently is left wondering where the truth lies? Will it really be open? Or given the intensely competitive drive for new drugs commanding vast amounts of money and new biotech companies that can be sold off like ones that Dr Soon Shiong has already founded and sold, what truly is the dominant motivating force? It seems likely that the answer maybe written ultimately only by future historians.  This is something that leaves me uncomfortable but also something about which I can do nothing.

Also troublesome is the fact that in a time of social and economic distress, vital infrastructure systems are becoming larger and more consolidated and hence potentially much more fragile.


Introduction                                            p. 4

Understanding the Current System                                p. 6

A Systemic View of the Three Domains of Health Care                p. 7

The Healthcare Transformation Institute                        p. 8

The Critical Nature of the Network as Described by
The National Coalition for Health Integration (NCHI)                p. 9

health information technology platform.                        p. 12

NCHI as an Entry in the Race for  Stimulus Funds?                p. 16

The NCHI Approach to the Problem
Focus on the Federal Government in 2009                        p.  21

NCHI in Nevada January 8, 2010                                p.  23
The NCHI Platform at Mobile Healthcare                        p.  26

State Health Information Exchange Cooperative Agreement Program    p.  27

Acquisition of National Lambda Rail                            p.  29

The Chan Soon-Shiong Institute for Advanced Health Inc.
(CSS Institute)                                            p.  30

WIRELESS Based Care and Technology                        p.  32
March 2010 Telemedicine at Good Samaritan Hospital                p.  35

What is To Be?                                            p.  40

How Does it Fit Together?                                    p.  43

CTIA Keynote March 23 2011                                p.  48

All About Advanced Health                                        p.  55

NANTWORKS -- Patrick Soon-Shiong Launches Technology Incubator    p.  57

NantWorks Vodaphone Strategic Alliance                            p.  60

Lambda Rail Appoints Chairman’s Advisory Council                p.  62

Net.Orange                                            p.  65

Net.orange Health Information Exchange                        p.  67

Employers                                                        p.  68

Challenges Facing Health information Systems --
the net.orange solution                                    p.  70

Recognizing the Value of Integrated Health Care Delivery Systems    p.  74

Health Care by Design                                     p.  76

“Prospects for Change”                                    p.  76

Further Investments Include KeyOn Communications Holdings,
Ipplex, Tensorcom                                        p.  81

Dr. Soon Shiong’s Goal?                                    p.  83

A Man With a Mission                                        p.  85

The Challenge of Doing that Which Cannot Be Done                p.  86

The Fate of Lambda Rail: He Who Has the Gold Makes the Rules        p.  89

XSEDE -- A National Grid Independent of  the Doctor’s’s Phoenix Infrastructure p. 96

Executive Summary                                p. 98

Endnotes                                                              p.103